Agricultural and Business Property Relief: Key Budget Changes

The Autumn Budget introduced significant changes to inheritance tax, particularly impacting farmers and business owners. Here’s what you need to know:

What Are Agricultural and Business Property Relief?

• Agricultural Property Relief (APR): This inheritance tax relief allows farmland to be passed down without incurring tax, regardless of its value.
• Business Property Relief (BPR): Similar to APR, this applies to business assets, offering the same unlimited relief.

What Changed in the Budget?

• A new £1 million combined limit will apply for both APR and BPR. 100% relief will apply to assets up to £1 million, with any value exceeding that subject to 50% relief.
• For estates with both qualifying agricultural and business assets, only one £1 million allowance will be available.
• Quoted Shares: Shares that are not listed on recognised stock exchanges (e.g., AIM) will receive only 50% relief, even if they qualify as agricultural or business assets.

When Do These Changes Take Effect?

The changes will come into effect on 6 April 2026, so there’s still time to plan and transfer assets in a way that minimizes exposure to inheritance tax.

What Should You Do Now?

If your estate could be affected by inheritance tax, it’s worth considering estate planning strategies to reduce liability. We can help you assess the value of your estate and explore options to mitigate tax exposure. Feel free to get in touch for assistance.

New Legal Duty: Employers Must Take “Reasonable Steps” to Prevent Sexual Harassment

Employers now have a legal duty to take reasonable steps to prevent sexual harassment in the workplace.

What Does This Mean for Employers?

• Employers must anticipate and prevent potential harassment, and take corrective actions if harassment occurs.
• Employment tribunals will automatically consider whether an employer failed in their duty to prevent harassment, with the possibility of higher compensation if negligence is found.

ACAS has provided detailed guidance, including recommendations for sexual harassment policies. For more information, visit ACAS.

Inflation on the Rise: What Does This Mean for Your Business?

The Consumer Prices Index (CPI) for October 2024 rose to 2.3%, up from 1.7% in September. This increase is driving key business decisions.

What’s Behind the Rise?

• Energy Costs: Higher energy prices contributed to the rise in inflation.
• Service and Alcohol Prices: Sectors like services (e.g., haircuts, airfares) saw a 5% inflation rate, and alcohol and tobacco prices rose sharply.
• Raw Materials: Falling costs in raw materials have been a positive offset for businesses.

What Does This Mean for Your Business?

• Energy Costs: Consider reviewing your energy suppliers and usage to reduce costs.
• Pricing Strategies: Businesses in the services sector should anticipate price increases and adapt their strategies to maintain customer loyalty.
• Cost Control: With raw material costs easing, now may be a good time to reassess margins or lock in favorable supply contracts.

This period of mild inflation presents opportunities for forward-thinking businesses to fine-tune their strategies for 2025.

Stress Awareness: Improving Workplace Well-being

During Stress Awareness Week 2024, the Health and Safety Executive (HSE) reminded employers of their duty to prevent work-related stress and promote mental health.

The Cost of Stress:

• 17.1 million working days were lost in 2022/23 due to work-related stress, depression, or anxiety.
• Employers are required to carry out stress risk assessments and take action to reduce stress-related issues.

HSE provides resources, including free online training and tools to assist employers. Could improving stress awareness lead to increased productivity? Explore HSE resources here.

Increased Employers National Insurance: What It Means for Your Payroll

The Autumn Budget announced a rise in Employers National Insurance (NI) from 13.8% to 15%, starting 1 April 2025.

What Does This Mean for Your Business?

• The threshold for paying NI will be reduced from £9,100 to £5,000 per year.
• Smaller Businesses: The Employment Allowance will increase to £10,500, benefiting over 865,000 employers.
• Larger Businesses: The £100,000 liability cap for Employment Allowance eligibility will be removed.

With increased payroll costs due to the NI and National Living Wage rises, businesses should factor these changes into their budgets and consider how to manage the increased costs. We’re happy to help with calculations and budget planning for 2025.

As always, we’re here to help you navigate these changes. If you have any questions or need assistance, don’t hesitate to reach out!